Enhancing the POS Experience
Retailers are continuing to look for technologies that offer long-term cost reductions and enhance the customer experience. For many, this means investing in enhanced point-of-sale related systems, such as self-checkout and self-service technologies, cash management and recycling systems, and mobile solutions.
These are trends, not fads, said Doug Wallace, VP and general manager of the retail division for Wincor Nixdorf, an Austin, Texas-based provider of point-of-sale hardware, software and services. Retailers should focus not only on small investments that can leverage what already exists to reduce cost, Wallace noted, but also seek out ‘game-changing’ ideas and technologies.
Associate editor/Web editor Samantha Murphy spoke with Wallace about which retail technology should be top of mind in 2010 and what trends to expect moving forward.
What are some of the major challenges retailers are up against in 2010?
Retailers are more optimistic about 2010 than last year, but many are still struggling to understand costs, drive associate productivity and build a more meaningful relationship with their customers. All of this is coupled with reduced capital budgets and even higher hurdle rates on capital investment.
We always see an intense focus on cost management in the commodity end of our business during economic downturns. In many instances, this means looking into extended lifetimes for technology and customers looking to drive costs down on service. As a result, Wincor Nixdorf is working to build commodity products that cost less to manage and run, and are engineered for longer life. We clearly see this as a major opportunity for us.
Where is the biggest opportunity for this growth?
The biggest opportunity involves a richer customer experience that revolves around improving the usability of the self-checkout and adding features like cash recycling and flexibility of configuration. Cash management solutions dramatically reduce the cost and risk of managing cash, while allowing for much more flexible scheduling of staff to cope with the peaks and troughs of demand. The flexibility of configuration allows the retailer to use different configurations in the same store to meet different needs, to match their systems to the size and demographics of each store, and even to flex the systems during busy periods to improve service levels.
Self-checkout is growing now more than ever. What can retailers do to meet this demand and stay competitive?
Customers are becoming more self-sufficient, and they are demanding a smoother and faster experience. Retailers need to continue to view the process through the eyes of the customer and to understand that, for many consumers, self-service is a positive choice, not a grudging one. The airlines have led the way on making improvements to both the technology and the process for self-service at the airport. Retailers, with one or two exceptions, have not yet really followed this lead. The ones that have had success have seen higher adoption rates, greater customer satisfaction and improved business results.
My key message to retailers on self-checkout would be to rethink the process, as a whole, and get innovative about front-end design geared to make life easier and faster for the customer.
Where else should retailers focus IT dollars this year?
Seeking out game-changing ideas and technologies is critical. Early investments don’t need to be huge, but they can’t lose sight of the continual need to innovate. It’s easy to get focused on the immediate return on investment and lose sight of the sustainability of the payback. This not only includes self-service and self-checkout, but also cash management and providing a differentiated experience using mobile devices.
Where is the industry headed in 2010 and in the next few years?
This year will continue to be tough for many retailers, but it appears at least that we’re now operating in a stable environment. In the longer term, innovation will be increasingly important in determining the winners and losers in retail. Providing real-time electronic data to the customer at the point of purchase will also become more important, as will designing systems that analyze and influence customer decision-making to drive business performance.
In addition, consumers will continue to take more responsibility for transactions via self-checkout, and this will allow store associates to focus more on customer service. I also expect commodity hardware products will be more engineered for longer life, as the cost of change and maintenance is now the major part of the total cost of ownership.